June 21, 2021
Main Street Monday — Small Business Banking Relationships Are Being Challenged by Rising Expectations
“Our research reveals that as the country emerges from pandemic-related restrictions, the needs and expectations of small businesses have changed significantly,” says Leo Mattiazzi, Executive Vice President of Global Innovation for CI&T. “Despite the many changes caused by COVID, small business owners are remarkably loyal to their banks. Even with new FinTech offerings integrated into day-to-day business operations, banks remain the primary owner of financial relationships. But as we’ve seen with COVID, the past is no guarantee of future success.”
CI&T, a leader in driving digital transformation for global brands, recently published (Re)open for Business, a new report examining how banks and other primary financial service providers can better serve small businesses in a post-pandemic world. Based on CI&T’s survey of over 500 small business owners, three key themes for the future of small business banking relationships emerged:
1) Redefining Value
As a growing number of small business owners turn toward financial technology companies for managing day-to-day business operations, their relationship with their primary financial institution has become more basic and limited. To maintain a healthy relationship with their small business customers, CI&T recommends that banks and credit unions position themselves as a connector between financial business management services, banking, and lending.
2) Basing Services on Individual Business Needs Rather than Size
CI&T’s survey revealed that small business owners develop more trust in their financial service providers when they offer resources and services tailored to the small business’ specific industry. Small Business owners indicated that they would be particularly interested in consultation services (68%) and a service where local branch tellers or managers come to the small business to complete banking transactions (75%).
3) Focusing Less on Transactional Relationships
According to CI&T’s survey, most small business owners still want the ability to walk into a physical branch. However, creating a digital experience to automate simple data entry could help banks and other primary financial institutions focus more on a personal relationship and less on a transactional relationship. Which, in turn, helps build trust and loyalty.
Click here to read CI&T’s full report.